Perfect Labor Storm 2.0 is a blog that highlights workforce trends, demographic shifts, and human resources changes that will change the way employers do business.

May 31, 2011

I can’t decide if it’s complacency, lack of urgency, or arrogance. But there seems to be a business-as-usual attitude running rampant among small business owners when it comes to recruiting and retaining employees. As I’ve been forecasting for over a decade, that attitude will eventually cause great harm to the competitiveness and bottom line of formerly great businesses.

A recent report by Deloitte, "Human Capital Trends 2011: Revolution/Evolution" identifies several critical 'game changing' trends that “will sweep through the field at an accelerated pace.”

Three of the trends highlighted in the report articulated with acute clarity the impact that demographics, technology, and globalization will have on even the smallest businesses regardless of the industry or region.

The corporate ladder is folding: Today's workplace isn't what it used to be. (How many times have you heard me say that?) Work will be more virtual, collaborative and project-based. The workforce isn't what it used to be either. Workers' needs, expectations and definitions of success now vary widely, rendering obsolete a one-size-fits-all approach to talent management. The Corporate Lattice is emerging.

Next generation leadership: Meeting emerging business challenges requires new skills and different qualities - and fresh models for finding, developing and engaging the next generation leaders. Given the demands of convergence, globalization, technology and the pace of change, organizations must rethink their approaches to developing next generation leaders.

While the report admittedly speaks to large, global organizations, small businesses can benefit a great deal about hiring and retaining employees by acknowledging and understanding these trends and observing how they approach solving them.

The report identified twelve trends: six revolution and six evolution categories. Five additional trends that I believe will have the greatest impact on small business are listed below. Or you can read the complete report on Human Capital Trends here.

Revolution

Workforce analytics: It’s about time but HR is finally being held accountable for what it does. Moving forward, HR will be asked to justify, not rationalize, important decisions. It will be required to produce more data, more information, and fresh thinking.

Chief Operating Officers for HR: The creation of a chief operating officer (COO) role for HR is an emerging approach given the scale and complexity of HR operations and programs. The HR COO is the leader who focuses on how HR services are delivered, as well as the design, development and implementation of those HR services globally.

Contingent workforce: Companies that understand the issues associated with contractors and manage them well, can benefit from improved operational performance, lower labor costs, smarter staffing decisions and stronger HR alignment with business objectives.

Obviously there are some jobs too, especially in healthcare, hospitality and construction, that just can’t be done “long-distance.” But many jobs can be performed completely or to a significant degree from an offsite or remote location.

Most interoffice communications are already handled via phone, email, and text messaging. Meetings, trainings or seminars can be conducted remotely via the internet using meeting software as long as attendees have an internet connection and a phone. With the increasing popularity of smartphones and tablets, attending a web-based meeting has also never been easier. For those companies with deeper pockets and more complex requirements, video conferencing is also an option.

Documents and data can all be stored and accessed “in the cloud” – a workspace accessible via the internet, which allows for project collaboration by co-workers and a centralized repository for frequently accessed information including documents and schedules. Google Apps and Microsoft Sharepoint are just too efficient but inexpensive solutions for small business.

There are also a number of advantages to the employer and the employee.

The employer might avoid leasing a larger workspace to accommodate a growing workforce. Some businesses might even be able downsize. (Success Performance Solutions is a perfect example of how a small business can go virtual.)

Utility and other overhead costs may also be reduced. In addition to eliminating our lease costs, our phone costs were cut by one-third. Electric and heating costs went to zero.

Storing and sending documents and memos in electronic versions only can reduce office supply costs.

If the employer provides paid parking or reimburses for using public transportation, they may be able to cut back on the number of spaces they supply.

Time previously lost in long commutes to and from the office, traffic, or bad weather can be used for work increasing efficiency, or for employees to enjoy a little more balance in their lives.

Going virtual however isn’t without its problems. There are a few logistical items to consider:

Will the employer need to provide equipment to the remote employees or reimburse them for phone, utility, and internet services?

Will the employer provide insurance to cover that equipment since it is not located at the brick-and-mortar office?

Virtual employees don’t excuse an employer from paying taxes. In fact, there is another layer of complexity added if the employee is a resident of a state different from that of the employer. Workers Compensation policies and Business Operating Policies may need to be secured for each state where the employee resides.

Income taxes differ from state to state and reconciling the taxes at the end of the year for more than one state can be a daunting task even for the accounting-minded. Using a knowledgeable accounting or bookkeeping service to handle payroll can save employers a lot of trouble and minimize risk.

Health insurance may also be affected if the employees are residents of another state.

And I’d be remiss if I didn’t mention hiring the right people. Working virtually requires discipline, trust, accountability, ability to work independently, and a strong work ethic. The candidate or current employee must have the right personality to work offsite, unsupervised, and with limited contact to other people.

For some positions, for some employees, and for some companies, the virtual office is a viable solution to hiring the right people with the right skills.

February 21, 2011

The economy is picking up steam and opportunities for CFOs to hire, as well be recruited by others, seems more likely. An article posted last week in PC World and CIO offered interviewing tips for and from CFOs to help hire the right person the first time.

Nearly all the CFOs interviewed agreed: they wanted “a highly motivated self-starter not afraid to make an occasional mistake, with a strong commitment to collaboration and being a team player, a willingness to take responsibility for failures and successes, and the ability to keep focused on goals while maintaining passion about their work and the company.”

But wanting, finding, and then confirming those traits and skills requires more skill than ever before on the part of the interviewer. The hiring insights included interviewing tips from quite a few CFOs, recruiters and management experts. Thanks to Focus, a business research site, I had the opportunity to participate and contribute to this article. You can read the full article at “Hiring Insights From, and For, CFOs” or continue here to read the highlights.

One of the biggest challenges confronting managers hiring for any position, not only CFO, is that out of work candidates have plenty of time to prepare for the interview, often more than the managers doing the interviewing. And at the C-Level and senior management levels, nearly every out-of-work exec has had some outplacement counseling which includes … yes, that’s right – interviewing skills training. Little if any time is invested by hiring manager to update their hiring skills. When it does happen, it’s generally a few minutes here or there or one bullet on the long list of annual HR training updates. That puts many human resource professionals and especially the senior managers interviewing for the new CFO at a distinct advantage.

In addition, many interviewers tend to do most of the talking. “A good rule of thumb is that a good interview is 70 percent listening and observing,” was a point I made for the article. Vibrant Mobile CFO Jeff Babka agreed and offered his own interviewing tip: “I first make sure that they understand the job, the company, our culture and my style. Then, I say, 'Look, tell me what you think I should know about you that would make me want to hire you. Start wherever you want in your life, end up wherever you want….”

Another common mistake is that managers use recommended interview questions as a checklist. They ask one question and evaluate the candidate’s response. Then they move on to question 2 and repeat the process. Then comes question 3. When the run out of questions or the candidate stops talking, the interview is over.

But an interview isn’t a test. It can’t be scripted. An effective interview should be dynamic. It’s a conversation where the candidate should be doing most of the talking. “Interviewers have to keep probing….Interviewers tend to stop when they hear the right answer…[when] I'm looking for is to have someone tell me what some of the challenges were during that process, were you able to repeat that, did other departments repeat that success? I can go into an interview with one question and keep asking more questions about that question."

Hiring the right CFO is part science, part art. Interviewing remains a critical component of hiring for open position. The uptick in hiring is a good sign for our economy but it will put undue pressure on the managers who are doing the hiring. In many situations, the candidate is a much better storyteller than the manager is a listener. The article on hiring insights for CFOs offers several additional recommendations. Read the full article here.

January 24, 2011

In a trend started during the latter half of the past decade, employers were forced to sift through mounds of online applications, thanks to the convenience of online job boards. The recession and millions of displaced workers only exacerbated the challenge. Recruiters are forced to read a lot of applications submitted by candidates who don’t qualify. That has led many employers to scale back their use of online job boards.

According to a December survey from the Corporate Executive Board, about 24% of companies plan to decrease their usage of third-party employment websites and job boards this year. Instead nearly 80% of the companies surveyed are hiring a different breed of recruiters who can find passive candidates, using networking sites like Facebook and LinkedIN , as well poaching candidates from competitors.

The experience of a Northeastern Wisconsin employer highlights the problem of what I projected several years ago would be a “resu-mess.” The employer had 134 $15-an-hour entry-level job openings. It received 850 applications. After reviewing them for high school diplomas or GED certificates, work history and experience, it eliminated 450 applicants. The remainder were tested for physical dexterity and given eighth-grade reading and math tests, which eliminated 208 more. The remaining 192 applicants were given personal interviews which focused on character issues.

That article enticed me to visit our applicant processing system to assess the relationship between the number of ad views to completed applications per open position. For Chief Marketing Officer, 285 potential candidates viewed the ad using a combination of an online job board and LinkedIN. Seventy-two completed the application, but only one candidate met the requirements of the client. A sales executive position attracted 170 candidates after being viewed by 5,636 jobseekers. A search for hospitality associates caught the eye of 21,234 candidates. Eight hundred thirty-nine (839) applied. Less than 150 applicants qualified for interviews.

This sheer volume of applications is forcing companies, small and large, to rethink how they recruit. Simply cutting back on posting jobs to CareerBuilder or Monster isn’t enough.

Qualified but passive candidates are building connections in LinkedIn. But many companies have blocked accessibility to networking sites. Human resources professional, generally a conservative group, are also often reluctant to join networking sites. Without access to online networks and a robust list of connections, recruiters are fighting this war for talent in handcuffs.

This onslaught of applications is also being processed and filtered by fewer recruiters and downsized human resources departments. Recruiting, compliance and administrative human resources functions in many small businesses are handled by one employee.

More applications and fewer resources lead to delays in responding to candidates. Top candidates may fall through the cracks and be ignored. Likewise, they might be turned off by a slow response and lack of acknowledgement. That’s an ill-advised strategy that employers competing for a precious few qualified employees afford to continue.

An online applicant processing system (APS) is one solution many companies are adopting. An APS allows employers to open the recruiting funnel without overwhelming resources to filter out unqualified candidates.

Using an APS, a hiring manager creates a job listing and then adds screening filter questions. Each question is carefully weighted and prioritized. Candidates can apply using an unlimited number of online job boards such as CareerBuilder, Monster, Indeed), free job boards, social media networking sites such as LinkedIn and Facebook, employee referrals, and other sites like Craig’s List. When the manager logs into the APS system, he or she can quickly view all candidates or filter for only candidates who meet the minimum qualifications. Unqualified candidates can be notified automatically using the system’s email templates.

An online Applicant Processing System is a smart, cost effective solution to a growing problem confronting nearly every organization – recruiting qualified candidates.

January 10, 2011

Hiring figures are starting to creep up. Layoffs and terminations are falling. That’s great news for our economy and the unemployed. But there’s some danger lurking in the shadows for employers.

The unemployment rate fell in December to 9.4 percent from 9.8 percent in November, the Labor Department just reported. It was the lowest in 19 months as the economy generated a net total of 103,000 jobs and marked the biggest one-month decline in the jobless rate since April 1998. The economy added 1.1 million jobs, or an average of 94,000 jobs a month in 2010. While that’s a far cry from the 200,000 needed to jump start our economy, it’s a dramatic turnaround from just a year earlier.

In addition, fewer jobs were eliminated in nearly every major industry in 2010. Downsizing in 2010 fell by 59 percent compared to the previous year. Employers announced 32,004 planned job cuts last month, the lowest monthly total since June 2000, when employers cut 17,241 jobs. The 2010 total was the lowest since 434,350 job cuts were announced in 1997.

Ironically this good news may not portend good times for employers. An employee migration has begun from those businesses that reduced labor cost by massive downsizing and squeezing every last bit of productivity out of the survivors. As the economy improves, an employee exodus will accelerate, especially for employers who aren’t paying attention.

The media rang in the new year with multiple reports that hiring is on the rise. Goldman Sachs projects that employers will add 2.2 million jobs this year, or about 180,000 a month, double last year's amount. Moody's Analytics puts the figure at about 250,000 per month.

For employers that have used the economic downturn and the scarcity of jobs to justify putting it to employees by freezing wages, cutting benefits, and reducing resources, the party is about to end. For employers who took this tactic, voluntary turnover is almost certain to rise dramatically as their employees learn there are new outlets for their efforts and talents. In addition, these employers likely will have a more challenging time making new hires as word of their actions gets around and impacts their reputations.

December 22, 2010

A sure sign of spring is when the buds emerge and the flowers peek through the ground. Likewise, a tell tale sign of a job recovery is when employers start hiring. When they start hiring recruiters, the forecast may call for a bumper crop.

And that’s exactly what is happening at several companies who are beefing up their recruiting staffs as hiring demands increase. Hiring is increasing slowly. But it is increasing steadily and the trend is expected to continue and accelerate in 2011. This uptick in hiring is driven by growth in business and an expected increase in retirements.

In a survey conducted this summer, CLC Recruiting, a unit of research organization Corporate Executive Board Co., found that about half of companies planned to increase their recruiting staffs and 19% expected to shrink them through May 2011. Last year, 6% planned to grow their staffs and about a quarter planned to shrink them.

In November, the number of U.S. job postings with recruiter in the title rose 20% from June to 5,306 on Indeed.com, which aggregates job posts from thousands of company websites and job boards. That’s a very positive sign because companies won’t hire recruiters if they weren’t expecting to hire employees in larger numbers.

Executives are expecting a wave of retirements of key staff over the next few years. The oldest edge of the Baby Boomers begins to turn 65 years old in 2011. In response to those retirements and company growth, companies have begun to build a database of possible candidates that could fill management, science and engineering roles, even before those positions open.

October 30, 2010

The demise of cursive writing has given rise to a generational conflict between older workers and Generation Y. I can’t begin to count the number of times I’ve heard from Baby Boomers and Generation Xers about how inappropriate, even rude, it is for a candidate or employee to send a thank you note by text and email. For many of these experienced workers, this digital mode of communication results in an immediate rejection or dismissal.

The inability to handwrite a legible thank you note is just one more indication of how unprepared and ill-mannered the newest workforce entrants are. But in the immortal words of the late Paul Harvey, “now let’s hear the rest of the story.”

The inability to write a simple thank you note in a flowing, somewhat artistic yet legible art form may not be the fault of these young workers. You can rightfully blame a young worker for not applying what he’s been taught. But you can’t blame him for not knowing something that parents and educators decided wasn’t worth teaching.

Just as the computer keyboard helped kill shorthand, it's now threatening longhand. The Christian Science Monitor wrote that “cursive writing is an endangered species given the rise of computers… and the increasing perception that cursive writing is a difficult and pointless exercise.” The Washington Post reported in 2006 that cursive handwriting is a dying skill. The USA Today wonders if cursive writing is worth teaching. It seems to me the decision has already been made.

But considering that many of the best college students and graduates today can’t handwrite a legible note using the Palmer or Zaner-Bloser method, the chances of finding a qualified worker goes from bad to improbable if cursive writing is a job requirement.

There is a blind assumption that cursive writing is a fundamental skill taught in elementary school today, just like it was in the 1990s and earlier. Most are in shock when I tell them that cursive writing is no longer taught in most schools past the 3rd grade. In some schools, it’s not taught at all.

Parents and experienced teachers recall the days when students spent 45 minutes practicing handwriting every day. Penmanship was a separate grade on report cards. The decline of cursive writing is happening as students are doing more and more work on computers. Today, handwriting instruction might get 10 or 15 minutes a few times a week. Many school districts stop teaching cursive writing in the 3rd grade but start teaching keyboarding skills in kindergarten.It’s not only that students struggle to write cursive, but read it as well. Stacked up against teaching technology, foreign languages and the material on standardized tests, penmanship instruction is a relic. In 2005, the SAT began including a written essay portion, and a 2007 report by the College Board found that about 15 percent of test-takers chose to write in cursive. The rest? They printed… in block letters.

Think about the implications of that. If a candidate sent you a block-printed note looking like a 6-year old wrote it, would he or she instill any more confidence in their ability than if they sent a well-articulated, spell checked text message? Should it matter what form a candidate uses? Shouldn’t the emphasis be on the composition, not the form?

Even the National Assessment of Educational Progress, which sets the standards to which many schools are required to meet, will be requiring 8th and 11th graders to compose on computers by 2011, with 4th graders following in 2019.

The problem with workers today isn’t penmanship, it’s the inability to compose even a simple memo. That means the emphasis in schools and subsequently in the workplace must be focused on articulating ideas and writing composition not the formation of letters. Data from the National Center for Education Statistics show that 26 percent of 12th graders lack basic proficiency in writing, while two percent were sufficiently skilled writers to be classified as "advanced." Handwriting is increasingly something people do only when they need to make a note to themselves rather than communicate with others. The ability to tap a keyboard quickly and accurately is a more desirable skill these days. In fact, penmanship is likely not even a required skill for most jobs.

So here’s some advice to Baby Boomer and Gen X managers – focus on the clarity and appropriateness of the message, not the vehicle of communication. And if you receive a thank you note, be grateful! At least that indicates your candidate has some sense of good business etiquette.

October 16, 2010

Saturday is National Boss Day and I was interviewed earlier this week about what makes a good boss….and how can employees “manage” their bad boss better. The staff writer, Cindy Stauffer, did an amazing job listening to what I said and writing what I hope is helpful advice for bosses and employees alike.

Once a New Holland dentist, now a business guru, Wolfe has been both an employee and a boss.

The son of parents who owned a clothing store in Pennsylvania's coal regions, Wolfe grew up in a household where things such as sales and marketing were regular discussion topics.

Wolfe went into dentistry, moving to Lancaster County to take a position as a dentist with Welsh Mountain Medical & Dental Center and then opening up his own practice in New Holland.

As the years went on, he found himself drawn back to his family roots. He discovered that he most enjoyed the business side of dentistry: the marketing, the employee management, the building of his practice. He started speaking to professional dental groups and, in 1995, he left his practice to focus on business consulting.

In his experiences working with businesses, he said, most bad bosses don't want to be bad.

"Most people in management," he said, "don't wake up in the morning and say, 'What can I do today to make my employee's life miserable?'

"They want the day to go well. If employees are having a bad day, they have a bad day, too."

More often, he said, a bad boss is a person who intends to lead well but doesn't know how.

In this slim economy, they might have risen to their position because of the combination of departments, early retirements or being the cheapest person available for the job.

Now they are in the leader's seat, and they are struggling.

"A lot of their actions are covering up for what they feel they lack," he said.

What can employees do?

"Sometimes it's just sitting down and saying, 'What can I do to make your job better?' " Wolfe said.

If you are toiling under a struggling boss, that might be the last thing you want to hear, Wolfe acknowledged. After all, why is it your responsibility to help your boss be better?

Because there is something in it for you, he said.

By talking to your boss, you might make your life easier by improving his or her management style, which Wolfe said tends to reflect the way the boss personally would want to be managed.

Someone who doesn't like to be micromanaged will not provide a lot of feedback to others, for example. Someone who wants frequent performance updates himself will want to check in often with employees.

Employees need to work with their boss, setting up a schedule of regular check-ins for the hovering manager or regular feedback from the taciturn manager.

And though it might be difficult, employees also should speak up when they have problems with a boss who is unpredictable or moody, Wolfe said.

"Talk to them. Say, 'When I come into work, I don't know how to approach you. It doesn't help my performance. It doesn't help me. Sometimes I need to talk to you, but you are in a bad mood,' " he urged.

"If you can work on communication, 50 percent of the problems go away," he said. "Fifty percent of problems are superficial communication issues."

Of course, there are bosses who are simply toxic: dishonest, immoral, angry, impossible.

For those situations, Wolfe said, there are no easy solutions.

"Put up with them until you can find a better opportunity," he said. "You can't change everybody. In those situations, it's about making the best out of it. Fortunately, they are few and far between."

"Most employers," he said, "really want people to have a good day. Someone just has to step up and initiate a conversation and see if it will help."

October 06, 2010

The generation gap is growing. But a few recent studies are shattering some perceptions.

Gen Y has caught a lot of flack for job hopping and for having a bad case of employee disloyalty. Baby Boomer and Gen X managers claim it’s impossible to find good hires from amidst this young generation even with a shortage of jobs and a surplus of jobseekers. There might be a lot of truth behind these claims.

The U.S. Dept. of Labor estimates that today's younbg adults will have between 10-14 jobs before they are 38; 1 in 4 workers have been with their current employer for less than a year; 1 in 2 workers have been there less than 5 years.

The recent report from the Bureau of Labor Statistics may surprise many people. The report shows that Late Boomers, born between 1957 and 1964, have been busy hopping between employers. In fact, between ages 18 and 44, the Late Boomers have had an average of 11 employers, which translates into a job change every 2.4 years.

Job hopping was even worse among Late Boomer men without a high school diploma. They held an average of 13.3 jobs, while men with at least a bachelor's degree still had 11 jobs. In the case of women, uneducated ones, in fact, had fewer jobs (9.7) than their degreed counterparts (11.7 jobs).

During the time of life (ages of 18-22) when most people move between school and summer jobs, the Late Boomers held an average of 4.4 jobs. However, they kept moving even at more mature ages: they had 2.6 jobs between ages 28-32, and at ages 39-44 they still held an average of 2 jobs. Among the jobs that 39- to 44-year-olds started, one third ended in less than a year.

Job hopping isn’t simply a Gen Y problem, and any explanation that sites only the character and upbringing of young workers for perceived disloyalty doesn’t match up with the picture painted by the data.

October 04, 2010

Who owns social media posts created by employees? Who owns materials developed by contractors? Do you have written agreements and policies covering these issues? Have you taken steps to use proper usage of trademark and copyrights by employees and partners?

Join me on Wednesday October 6 at 11 AM EDT on my Blog Talk radio program “Workforce Trends” when Erik Pelton and I will discuss issues that business owners and employers need to be aware of regarding intellectual property ownership and social media usage.

Remember this date! Wednesday 10/06/2010 at 11 a.m. EST. The show will be broadcast live! Call in number is 646-200-3752 or click here to listen. Join us for this discussion and bring your questions!